9.7 Decommissioning and Environmental Protection Plans

Box 9.7 Decommissioning and Environmental Protection Plans

A well-designed environmental protection regime will also require closure and a decommissioning plan and should

1. start as early as the feasibility stage (design with the end in mind) and continue on a regular basis throughout the life of the operation; 2. be completed with arrangements in place for any environmental hazard post closure site maintenance or environmental monitoring that might be needed after closure is completed; 3. include planning for the decommissioning and removal of plant and equipment, long-term land reclamation and stabilization and restoration to an alternative use; and 4. provide for handover to the community of any remaining useful social or productive assets.

and possibly even repair shops for small road vehicles) and equipment (for example, working vehicles) that can be used by the community after the mine is closed.

If any such buildings and assets are identified early in the project life, toward the end of the project they can be handed over progressively and operated and maintained by the community agency or organization that will eventually receive and use them, so that that this group is well equipped to own and operate them once the operation closes and the company has departed. Buildings that are not suitable to be handed over, such as laboratory or office buildings or workshops for large mining trucks and shovels, should be closed and removed. In situations where there may be legacy issues from past operations, environmental audits and surveys of the legacy sites should be undertaken on a regular basis to identify any environmental risks, set action priorities, and mobilize needed funding according to the severity of the risks (World Bank 2010).

The mining agreement can be used to require the mining company to provide funding for rehabilitation and mine closure. The Liberian Model Mineral Development Agreement (2008) states the following, for example:

The closure management plan must also set forth the means by which the Company proposes to ensure the availability of funds to finance its environmental restoration and remediation obligations under Sections 8.2 and 8.3 of the Mining Law so that the cost of closure will be borne by the Company and not the public or the Government. If the Company does not agree in writing with the Government to a “pay-asyou-go” funding scheme, then a funding guarantee reasonably satisfactory to the Minister of Finance from a third party financial institution with a longterm credit rating of at least A (or its equivalent) from at least two internationally recognized credit-rating agencies with provision reasonably acceptable to the Minister of Finance and the Minister [of Lands, Mines and Energy] for redetermination of estimated closures costs at least triennially and adjustments in the amount of the funding guarantee will normally be acceptable.45

Social concerns

While not all social impacts are amenable to regulation, requirements related to mitigating social risks should be included in laws and regulations to ensure they are implemented in an orderly and responsive manner. These requirements include community notification, information dissemination, community consultation, land acquisition, compensation, and involuntary resettlement.

Hydrocarbons. Oil and gas companies have undertaken social investment programs in many of the countries where they operate. These are voluntary contributions made to benefit communities and broader societies, usually made in terms of transferring skills or resources (IPIECA 2011a). Initial experience of this has indicated that an approach limited to donations and infrastructural programs will not be effective and will likely lead only to short-term positive public relations in the local area. Day-to-day stakeholder management of such investment appears to be crucial and rather than programs of social investment. The way in which a social investment program operates can in practice create or feed into divisions between groups and even lead to community violence (IPIECA 2011a, 13). Some companies have adopted a regional rather than a local strategy to counter this. Companies have also found that partnering with NGOs, government agencies, and universities is a useful way to obtaining the expertise that they lack. Boosting the capacities of local authorities is also appreciated in communities as a worthwhile goal. It can increase transparency and improve the authorities’ ability to respond to demands and requests from their own citizens.

268 OIL, GAS, AND MINING